A reader sent in this email:
Indiabulls promoters have split their company and I see some corporate governance issue in Indiabulls Wholesale. Indiabulls Wholesale was owning 100 % Indiabulls Technology where 1200+ employees are working. In FY 2013, revenue was 46 crores and FY 2014 revenue should be more than 100 crores going by their team business ramp up.
Without informing shareholders, Indiabulls Wholesale has divested the IB Technology in Q1 quarter. It raises below question which is a serious corporte governance issue.
1. The Indibulls Technology buyer has not been disclosed. If the buyer is Saurab Mittal or Rajiv Rattan, then it is a serious fraud.
2. Valuation at which it has been sold is not disclosed. Please be noted that the Indiabulls Technology is growing at a scorching pace and for a technical start up company, initial years will not have much profit and revenue will be increasing in multifold. So when we value the company, we need to go by the future revenue growth and their order book.
Going by this, even in the worst case valuation, Indiabulls Technology should be deserving 400 crores. But the promoters have sold it under the carpet for their own benefit or internal settlement with some body.
3. Indiabulls Technology is a major revenue contributor and whenever they have sold this, it should have been announced to exchange. It should not appear as one of the line item in their quarterly result. It is present as item # 4 under standalone quarterly result declaration of Indiabulls Wholesale.
When news floated about the promoters splitting up their empire, Indiabulls WholeSale went down drastically whereas other group companied held on to their price. This indicates that people are aware that IB Technology is going out of Indiabulls Wholesale and insiders offloaded their price.